Birdjaguar said:
Which communism doesn't do. At the end of the day though, its individual initiative that drives innovation and growth. And that process begins and ends with "what's in it for me".
I never claimed that Communism could do that either. All I claimed was that there was a economic system based on equal distribution of wealth that would sustain the standard of living we are currently enjoying. We haven't seen such growth as in SK, Germany, Japan, or the Ind Rev for a long time now. Frankly, good growth is ~3% or so. So it's not like Capitalism does that either...
Look at East Asian growth -- that was hardly a score for laissez faire capitalism. It wasn't in any way shape or form "laissez faire".
A developing country has to rely on individual initiative and entrepreneurship, but an industrialised nation already has an established industrial base. So growth these days comes from innovation. Under
my communism, the incentive is still profit. Lets say a manufacturing company has demand for X units at $Y each. If the company finds a way to produce those X units more efficiently, the company can make a profit. The company can use the profit to:
(a) Buy more machinery, workers, raw materials, thereby increasing the number of units produced, further increasing profits
(b) Sell the units at a cheaper price $(Y - dY)
(c) Reduce the number of hours of the workers, or otherwise improve worker welfare
(d) Develop more efficient manufacturing processes
Option (a) may not be a good short term investment, since there is only demand for X units, but extra production capabilities might come in useful if demand increases in the future. Options (b) and (c) would increase the standard of living of the workers. Option (d) would allow future growth for the company. All of the options are manifestations of economic growth, and the effect is to increase the GDP of the country.
Under capitalism, there would be an option (e) which is to distribute the wealth among the owners of the company. Although this would also result in GDP growth, its social consequences are undesirable.
You're probably wondering where this innovation is supposed to come from. It comes from the same place innovation comes from under capitalism -- the company employs people to make improvements on their manufacturing processes or product designs.
So really, it's the same old story of Capitalism, because the rules of economics haven't changed. All that's changed are the tax rates.